Presently
before the Court is a motion for judgment on the pleadings
filed by Prudential Insurance Company of America
("Prudential"). (Doc. 25.) The Court DENIES
IN PART and GRANTS IN PART
Prudential's motion.

I•
Background

Prudential
provided a life insurance policy to Russell Bailey (the
"Policy"). Sherry Bailey was Russell Bailey's
wife and the beneficiary of the Policy. On June 24, 2015,
Russell Bailey died. On June 26, 2015, Sherry Bailey made a
claim on the Policy.

The
Policy contained $332, 000.00 of term life coverage and $332,
000.00 of accidental death coverage. On January 21, 2016,
Prudential settled the term life portion of the Policy and
placed $343, 420.50 into a Prudential Alliance Account (the
"Account") in Sherry Bailey's name. The
"Alliance Payment Notification" sent to Sherry
Bailey described the Account as follows:

We have approved your group life insurance claim and have
settled your benefit through Prudential's Alliance
Account settlement option. An interest bearing account has
been established in your name. . . . With the Alliance
Account, you can access your money immediately by writing a
draft for the amount you'd like to withdraw. You can
withdraw the entire amount immediately, which will close the
account, or you can write drafts as needed. Any balance you
maintain will earn continuous interest.

(Doc. 28-1, at 12.)

On
January 26, 2016, a grand jury indicted Sherry Bailey for the
murder of Russell Bailey. Between January 29, 2016, and
February 3, 2016, Sherry Bailey wrote three checks
withdrawing a total of $83, 855.50 from the Account. On
February 8, 2016, Prudential notified Sherry Bailey that it
had frozen the Account. Sherry Bailey claims that the Account
contained at least $259, 616.51 at the time Prudential
imposed the freeze.

On May
25, 2016, Prudential filed an interpleader complaint in this
Court seeking to enjoin Sharmon Howard, Kenneth Moon, Jr.,
James Bailey, and Randall Bailey as potential beneficiaries
under the Policy. Simultaneously, it moved to "deposit
into the Registry of this Court a total of death benefits in
the amount of $591, 564.90, plus applicable claim interest,
if any (the 'Death Benefit') that is due and payable
as a result of the death of Russell Bailey, who was insured
under [the Policy] ." (Doc. 3 at 1.) Prudential made no
mention of any distributions to Sherry Bailey under the
Policy or the $83, 855.50 Sherry Bailey had already collected
under the Policy.[1]On May 26, 2016, this Court granted
Prudential's motion.

Sherry
Bailey filed an answer and counterclaim on August 31, 2016.
In her counterclaim she alleges that Prudential illegally
took $259, 616.51 from her Account and placed it into the
Court's Registry without her permission. She also alleges
claims for fraud and breach of contract related to her
agreement with Prudential to place the distributed term life
benefits into the Account.

On
December 21, 2016, Prudential moved for judgment on the
pleadings. In its motion, Prudential asks the Court to: (1)
discharge it "from any and all liability" to Sherry
Bailey, Sharmon Howard, Kenneth Moon, Jr., James Bailey, and
Randall Bailey; (2) discharge it from liability for all
claims relating to the Policy; (3) enjoin any claims against
it relating to the Policy; (4) dismiss with prejudice all
claims against it relating to the Policy, including Sherry
Bailey's counterclaim; and (5) award it reasonable legal
fees and costs. (Doc. 25 at 1-2.)

II.
Discussion

At the
outset, the Court notes that this case is not as clear cut as
Prudential would lead the Court to believe. Prudential would
have the Court believe that it is an innocent party who wants
to pay its contractual obligations but simply does not know
who it needs to pay. Sherry Bailey's counterclaim,
however, casts serious doubt on Prudential's narrative.

In her
counterclaim, Sherry Bailey alleges that Prudential was not
entirely forthcoming in its interpleader complaint and motion
to deposit funds. Specifically, she claims that Prudential
stole approximately $259, 000.00 from the Account and placed
it in the Court's Registry. She also claims that
Prudential did not give her notice prior to depositing the
disputed funds in the Court's Registry. These claims
significantly complicate Prudential's interpleader action
and raise questions about the validity of the Court's
Order accepting the disputed funds.

After
reviewing the motions and pleadings filed in this case, the
Court takes the following actions. First, it
RELEASES back to Prudential all the funds it
accepted on its Order dated May 26, 2016. Second, it
DENIES IN PART and GRANTS IN
PART Prudential's interpleader request. Third,
it DENIES Prudential's request for a
discharge and injunction. Fourth, it DENIES IN
PART and GRANTS IN PART
Prudential's motion for judgment on the pleadings. Fifth,
it DENIES Prudential's request for
attorneys' fees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A.
...

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